State's taxable sales in February reached milestone

Arizona retail sales rose 10.4 percent in January compared with the same month a year earlier, driven by strong sales of cars, trucks, building materials and clothing, the Arizona Department of Revenue said Friday. That's the first time since June 2006 that the state has seen a double-digit growth in taxable retail sales, said Arizona State University economist Dennis Hoffman, who tracks retail sales closely to help state officials forecast sales-tax revenue. "The interesting thing is that it's being fueled by durables," he said. "Motor-vehicle sales continue to be beyond robust and borderline explosive." Motor-vehicle sales, which have been showing double-digit growth for several months, rose 28 percent in January compared with the previous January. Hoffman said consumers who shunned new-car purchases over the past three years are apparently feeling confident enough to spend. Hoffman prefers to look at numbers over three months to smooth out volatile monthly changes. Looking at the November-through-January period, he said motor-vehicle sales have risen 25 percent; clothing, about 8 percent; building material, lawn and garden, about 6 percent; and furniture and furnishings, about 4 percent. "Again, it is not a blockbuster-growth scenario like we have seen in the past, at least not yet," Hoffman said. "But one thing about Arizona's economy is that once it gets some momentum, it does tend to grow pretty rapidly."

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